JoshHeaps.Net/Content/Socialism/constitution.md

@@ -9,7 +9,7 @@ summary: The biggest risk is that the model gets repealed, not that the state ov
 
 This model asks little of the state: charter [a bank](the-bank.md), enforce [the lock](the-lock.md), run [the floor](the-floor.md). The concentration-of-power argument still applies to the floor (see [Open Problems](open-problems.md) on "essential" sectors), but it isn't the biggest risk.
 
-**The main risk is durability, not overreach.** A model that can be built gradually can be dismantled gradually. A future Congress can defund the bank, and a statutory lock can be repealed by the same kind of majority that passed it. Postwar social democracy got rolled back once the coalition that built it weakened; a voluntary co-op sector is exposed to the same thing. So the design question is: **what makes this hard to reverse?** Partial answers: the lock written into each co-op's own charter and backed by an independent lock share (see [The Lock](the-lock.md#how-the-lock-is-made-to-hold)), and into state co-op law, not just federal statute; a federation that becomes financially independent of the public bank; and, above all, a co-op sector large enough to have its own constituency.
+**The main risk is durability, not overreach.** A model that can be built gradually can be dismantled gradually. A future Congress can defund the bank, and a statutory lock can be repealed by the same kind of majority that passed it. Postwar social democracy got rolled back once the coalition that built it weakened; a voluntary co-op sector is exposed to the same thing. So the design question is: **what makes this hard to reverse?** Partial answers: the lock written into each co-op's own charter and backed by an independent lock share (see [The Lock](the-lock.md#how-the-lock-is-made-to-hold)), and into state co-op law, not just federal statute; a federation that becomes financially independent of the public bank; and, above all, a co-op sector large enough to have its own constituency. How each of those works, what it can't protect, and what happens now that any president can replace the bank's board, is in [Making It Last](durability.md).
 
 **Money out of politics.** Legislative work pays well enough that good people want the job, but any money, gift, or benefit from a non-government entity ends the salary and starts a prison sentence. Politicians should benefit only from serving their people.
 

JoshHeaps.Net/Content/Socialism/durability.md

@@ -0,0 +1,131 @@
+---
+title: Making It Last
+section: Guardrails
+order: 125
+summary: Anything built by one law can be undone by the next, so the model is built to survive a hostile government, and this page says what that protects and what it can't.
+---
+
+# Making It Last
+
+The biggest threat to this model isn't that the state grows too strong. It's that a later government undoes it. Everything here rests on ordinary laws: a charter for [the bank](the-bank.md), a law backing [the lock](the-lock.md), and money set aside for [the pilot](pilot-spec.md). Anything one Congress passes, a later one can repeal ([The Constitution](constitution.md)).
+
+Repeal is only the most obvious way to kill it. Public programs die in quieter ways too. They get starved of money and staff, run by people who want them to fail, or left without anyone able to sign off on decisions. A hostile government can also make an experiment *look* like it failed. This page goes through how those things have happened to real programs, and what the model does about each one. Some of it can be protected well. Some of it can't be protected at all, and the page says which is which.
+
+## How public programs get killed
+
+**By doing nothing: the Export-Import Bank.** America's export-credit bank has to be reauthorized by Congress every few years. In 2015 Congress let its charter lapse, and from July 1 until early December it couldn't make new loans. Then a second problem hit. Its board needs three voting members to act, and when two terms expired in July 2015, the Senate didn't confirm replacements. For nearly four years the bank couldn't approve any deal over $10 million. By mid-2016, more than 30 deals worth over $20 billion were stuck waiting ([Congressional Research Service, 2016](https://www.everycrsreport.com/reports/IN10574.html); [2019](https://www.everycrsreport.com/files/20190809_R43581_3f42ff567900d03421b053fdee99f7450d886877.html)). Nobody had to vote to shut it down. Opponents only had to not act.
+
+**By cutting its staff: the CDFI Fund.** The Treasury's Community Development Financial Institutions Fund has backed community lenders for three decades. In March 2025, a presidential order told it to shrink to "the minimum presence and function required by law." In October 2025 the Treasury moved to lay off its roughly 100 staff. 105 Republican members of Congress wrote to defend it, and a court order blocking layoffs during that fall's government shutdown held them off for the time being ([Roll Call, 2025](https://rollcall.com/2025/10/27/senate-and-house-gop-defend-community-finance-fund-from-trump-cuts/)). A program that runs on the government's staff can be starved without being repealed.
+
+**By taking the money back: the Greenhouse Gas Reduction Fund.** Congress created this $27 billion fund in 2022 to seed green lenders. By early 2025, $20 billion had been awarded to eight nonprofit lenders and was held at Citibank, which acted as the government's financial agent. In March 2025 the new administration terminated the grants and froze the money. The courts have gone back and forth, and the case is still going ([Columbia Law School Climate Law Blog, 2026](https://blogs.law.columbia.edu/climatechange/2026/08/07/a-big-win-in-few-words-what-to-glean-from-the-climate-united-fund-decision/)). Then, in July 2025, Congress repealed the program and took back all of its money that hadn't yet been committed. It did that inside a huge budget bill, passed by simple majorities under special rules that block a Senate filibuster. Because almost all of the money had already been awarded, the repeal itself took back only about $19 million ([Congressional Record, July 9, 2025](https://www.congress.gov/119/crec/2025/07/09/171/118/modified/CREC-2025-07-09-pt1-PgS4281-4.htm)). Two lessons: money the executive branch can reach can be frozen with a letter, and money not yet committed can be taken back by a line in a bill few people read. Money already awarded was much harder to take back.
+
+**By changing what it is: America's co-op bank.** When the Reagan administration tried to close the National Consumer Cooperative Bank in 1981, it survived by being privatized. Then it drifted toward lending to co-ops that could have borrowed anywhere ([Has This Been Tried?](precedents.md#americas-co-op-bank-the-national-consumer-cooperative-bank)).
+
+## How public programs survive
+
+**A fair trial and a steady base: the Bank of North Dakota.** North Dakota's state-owned bank opened in 1919, created by a farmers' movement openly sympathetic to socialism. Its opponents fought it every way they could. They sued and lost at the US Supreme Court in 1920. They recalled the governor in 1921, the first governor recall in American history. They put abolishing the bank on the ballot, and lost by 4,238 votes. They worked with East Coast financiers to boycott the state's bonds, and that boycott, along with the recall, helped push the movement that founded the bank out of power. What saved the bank itself, historians say, was the governor from the opposing side who replaced the recalled one. He decided it was "right and just and wise to give it a full, fair, and honest trial," and ran it "in a sane and conservative way" ([Bank of North Dakota history](https://thebndstory.nd.gov/years-of-desperation/organized-opposition-tried-to-take-the-bank-down/)). It also has a structural advantage: by state law, the state's own money must be deposited with it ([N.D. Century Code § 6-09-07](https://www.ndlegis.gov/cencode/t06c09.pdf)). It's still running more than a century later. It survived by being careful, which this model's bank is designed to be from the start.
+
+**Owners spread everywhere: rural electric co-ops.** In the mid-1930s, nine in ten rural American homes had no electricity. Private utilities wouldn't wire sparse areas. From 1936, the federal Rural Electrification Administration lent money to farmers who formed co-ops to do it themselves. By 1953, over 90% of farms had power. In 1942, facing false accusations during the war, the co-ops formed a national association to speak for them in Washington. Today more than 900 electric co-ops serve over 40 million people ([America's Electric Cooperatives](https://www.electric.coop/our-organization/history); [2026](https://www.electric.coop/rea-at-90-years-celebrating-the-landmark-law-that-birthed-rural-electrification)). The program built its own defenders: owners in almost every congressional district. That cuts both ways. Critics can fairly say that defenders like these keep subsidized loans flowing long after the original job is done.
+
+**Paying the government back: the Farm Credit System.** Congress started a system of farmer-owned co-op lenders in 1916 and expanded it in 1933, with federal money. The lenders repaid all of it, and by 1968 they were wholly owned by the farmers who borrowed from them ([Farm Credit Administration](https://www.fca.gov/about/historical-highlights-of-fca-and-the-fcs)). Once the system belongs to its borrowers, no budget vote can starve it and no president can replace its lenders' boards. It wasn't the end of the risk: in the 1980s farm crisis the system needed a federal rescue, of which about $1.3 billion was used.
+
+**What political scientists find.** Eric Patashnik studied what happens to major reforms after they pass. He found that "the reforms that stick destroy an existing policy subsystem and reconfigure the political dynamic," creating their own supporters ([Reforms at Risk, Princeton University Press](https://press.princeton.edu/books/paperback/9780691138978/reforms-at-risk)). Reforms that leave the old interests in place tend to unravel.
+
+## Who controls the bank now
+
+The model says the bank should be walled off from politicians "the way monetary policy is walled off from Congress." The obvious way to do that is to give the bank's board fixed terms, so a president can remove them only for misconduct. That route is now closed.
+
+In June 2026, in *Trump v. Slaughter*, the Supreme Court held that the Federal Trade Commission's protection from removal was unconstitutional, because officials under the President's "general administrative control" must be removable at will. It put aside only the Federal Reserve, "to the extent that it follows in the distinct historical tradition of the First and Second Banks of the United States—both of which influenced monetary policy" ([Trump v. Slaughter, 2026](https://www.supremecourt.gov/opinions/25pdf/25-332_qn12.pdf)). The same day, in *Trump v. Cook*, the Court upheld the Fed governors' protection, on the ground that "monetary policy should not be subject to political interference" ([Trump v. Cook, 2026](https://www.supremecourt.gov/opinions/25pdf/25a312_5468.pdf)). A bank that lends to co-ops doesn't set monetary policy, so it almost certainly doesn't fit that exception.
+
+So this model assumes **any president can replace the bank's whole board, any time.** The protection has to come from what the board *can't* do, not from who sits on it. That's also more honest. A bank run by people nobody can remove would be exactly the unaccountable power this model warns against elsewhere.
+
+## The rules
+
+### What a new board can't change
+
+The things that decide whether the experiment is fair are written into the law that creates the bank, not left to the board:
+
+- the [co-op definition and the lock](worker-ownership.md) that borrowers must accept;
+- the measures, thresholds, reviewers and deadlines in [the decision rule](pilot-spec.md#the-decision-rule);
+- **the lending standards**, meaning the scoring model used to judge applications, filed with the rest of the plan before the first loan;
+- the [rate audit](pilot-spec.md#what-market-rate-means), which works in both directions;
+- the loan limits and the rules against [political favoritism](pilot-safeguards.md#political-favoritism);
+- **how loans are managed once made.** A loan can be called in early only if payments stop, never for a technicality. The rules for handling a co-op in trouble are filed in advance too.
+
+The board can propose changes to the lending standards, with published reasons. The reviewers then report every result both ways: under the original standards and under the new ones. By law, no official can direct a decision on a particular loan, and any attempt is logged and published.
+
+### Rigging the result
+
+A hostile board has two ways to make co-ops look like failures without breaking any rule openly. The reviewers check for both.
+
+- **Turning away good applicants.** Every year, the reviewers audit a sample of rejected applications against the filed standards and publish the rejection rate for applications that met them. If too few co-ops get funded because applicants didn't show up, that's a real result, as [the pilot](pilot-spec.md#why-about-400-co-ops) says. If too few get funded because the bank turned away applicants who met its own standards, the final verdict says so: **"not tested,"** not "failed."
+- **Making bad loans on purpose.** If the [emergency stop](pilot-spec.md#the-decision-rule) fires, the reviewers check whether the losses come mainly from loans that broke the filed standards. If they do, it's treated like fraud, not like a verdict on co-ops. Lending restarts under the original standards, and those loans are reported separately.
+
+**This isn't a way to keep the bank alive.** "Not tested" means exactly what "failed" means for the bank: no new loans, the wind-down, and no second round of money. It only changes what the record says about co-ops. Nothing on this page extends the timeline either. The latest the final review can happen is year 15, which is the pilot's existing rule for when good applications are scarce.
+
+### No quorum, no freeze
+
+Unlike the Export-Import Bank, this bank can't be frozen by leaving board seats empty. It uses ordinary delegation, which keeps the President in charge:
+
+- **Standing authority for smaller loans.** The board appoints senior credit officers and gives them authority to approve loans up to $1 million under the filed standards. That authority doesn't lapse when board seats go empty. Any board can take it back, publicly, but it can't disappear by default.
+- **No quorum means an acting chair, not no one.** If the board can't meet, the Treasury Secretary, or an acting official named under the normal federal vacancy law, can act for it on loans too big for staff.
+- **Applications can't be buried.** A complete application gets a decision within 120 days, yes or no, with reasons. The clock pauses while the bank is waiting on information it asked for. The rule forces an answer, not a yes.
+- **A second check during vacancies.** Any loan over $500,000 approved while the board lacks a quorum is cleared by the independent auditor before any money goes out.
+
+### Where the money sits
+
+The $350 million is paid into the bank as its own capital when it's chartered, not handed over year by year. The model says plainly what that does and doesn't protect.
+
+- **It needs explicit legal cover.** By default, the Treasury keeps a federal corporation's accounts ([31 U.S.C. § 9107](https://www.law.cornell.edu/uscode/text/31/9107)). The farm co-op banks were exempted from that rule by name, and this bank's law has to do the same, so its money isn't held where one agency can freeze it.
+- **Running costs come from the bank's capital and income**, as [the pilot](pilot-spec.md#how-much-money-and-why) already says, not from yearly appropriations. So nobody can starve it by refusing to pass a budget line.
+- **The reviewers are paid in advance.** Money for the independent review is set aside from the capital on day one and paid to the reviewers by contract. A hostile government can't quietly disable the referee by not funding it.
+- **What it doesn't protect.** Money not yet lent can still be taken back by Congress, the way the green-bank program's uncommitted money was. That takes a law, and it happens in public, but it can be a single line in a large budget bill passed by a simple majority. The pilot's capital will sit partly unlent for years, and that's exactly the kind of money that gets taken. Congress can also attach riders to spending bills that bar the bank from using its money. Neither can be prevented. The only defense is that doing it is visible.
+
+### Loans already made keep their terms
+
+Every loan is a binding contract. If a later law ends the bank, money already lent keeps its terms, and the loans are offered first to co-op and community lenders, as they would be after a failed test (see [the decision rule](pilot-spec.md#the-decision-rule)).
+
+The wind-down has its own guards. Loans are sold for no less than an independent appraisal, only to lenders named in the bank's law (co-op lenders, credit unions and nonprofit community lenders), and they can't be resold to anyone else for five years. Otherwise a hostile Treasury could sell them cheaply to a front for a distressed-debt buyer.
+
+Future stages of a loan that haven't been paid out are *not* promised. The contract says so in plain words. If Congress ends the bank, it doesn't owe anyone money for loans it never made, and one Congress can't lock a later one into paying out.
+
+If a later law tried to change the terms of money already lent, there's precedent for the government owing damages. In *United States v. Winstar* (1996), Congress changed banking rules in a way that broke promises regulators had made to savings-and-loan companies that took over failing ones. The Court's lead opinion held that Congress was free to change the law, but the government still owed damages for breaking its contracts ([Winstar, 1996](https://www.law.cornell.edu/supremecourt/text/518/839)). It's only partial protection. There was no single majority opinion, the damages cases dragged on for years, and it only helps where the contract clearly puts the risk of a change in the law on the government. So the loan contracts say that explicitly.
+
+### The lock doesn't depend on Washington
+
+[The lock](the-lock.md) lives in each co-op's own charter and is enforced by an independent lock-holder, not by the bank. So repealing the bank's law doesn't unlock a co-op in ordinary times. There's one big exception. The lock only holds in bankruptcy if federal bankruptcy law is amended (see [The Lock](the-lock.md#when-a-co-op-goes-bankrupt)), and a Congress that repeals the bank could repeal that amendment too.
+
+States are the second layer. Co-op law in America is state law. Massachusetts, for example, has had a law for worker co-ops since 1982, but a co-op can leave that status by a two-thirds vote of its members ([Mass. Gen. Laws ch. 157A, § 4](https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter157A/Section4)). That's exactly the exit the lock closes. So the model includes a short model state law that recognizes locked co-ops and their lock shares. States adopt it or don't. Nothing in the federal law requires it. It only protects co-ops that chose the lock, in exchange for a loan they chose to take.
+
+### Federal test, state copies
+
+[Open Problems](open-problems.md) asked whether the bank should be federal or run by states. The answer here is both, for different jobs:
+
+- **The test is federal.** One bank, one plan and one set of reviewers make one clean experiment. Fifty small ones, each designed a little differently, can't be added up into one answer.
+- **Any state can copy it.** A state can charter its own co-op lender under the same published rules. A state lender can even be given a steady base the way North Dakota's is, by holding some state money on deposit. Its results are reported separately and don't count toward the federal test in either direction. If Washington abandons the idea, the states that copied it keep running.
+
+### The sector pays its own way
+
+The last layer is the only one that doesn't depend on anybody's goodwill: the co-ops' own money. The [federation](federation.md)'s shared fund is built to become a lender itself, the way Italy's Coopfond has lent to co-ops for three decades out of their own profits ([Has This Been Tried?](precedents.md)). The sooner co-ops can finance each other, the less a hostile Congress can do.
+
+## Why a hostile government might leave it alone
+
+The Bank of North Dakota survived because the side that had fought it decided to give it a fair trial. This model tries to make that the cheaper choice for an opponent:
+
+- **It's a one-time cost.** There's no yearly spending line to fight over.
+- **It shuts itself down if it fails.** An opponent who expects co-ops to fail can let [the decision rule](pilot-spec.md#the-decision-rule) prove it, and the rules above make it hard to rig that result either way.
+- **It buys no one's company.** It still spends public money, and conventional competitors and some employers will oppose it anyway. Italy's main employers' association got part of its worker-buyout program suspended by the EU ([Has This Been Tried?](precedents.md#italys-co-op-funds-coopfond-and-the-marcora-law)). But no industry loses its property.
+- **Every result is public,** so whoever ends it early has to explain why.
+
+None of that stops a determined opponent. It only raises the cost of acting in bad faith.
+
+The electric co-ops show the longer-term defense. If the test passes and the sector grows, it will eventually have members in most congressional districts. People who own part of something defend it. The same defenders can also lobby to keep a program running after it's stopped earning its place. That's why the pilot's growth depends on a fixed test, not on how many friends it has.
+
+## What this can't protect
+
+- **The bank itself.** A Congress and President who both want it gone can repeal it. Nothing here prevents that, and nothing should. A democracy has to be able to change its mind. The design only makes sure the repeal is done by law, and that it can't take the co-ops' charters with it.
+- **Money not yet lent,** which a budget bill can take back, and riders that bar spending.
+- **A board that's merely timid.** The rules stop a freeze and expose rejecting good applicants. They can't make a hostile board eager, stop it hiring timid staff, or stop it pulling back the credit officers' authority in public.
+- **A small constituency.** At pilot scale, around 400 co-ops employ perhaps several thousand people. That's nowhere near enough to defend anything politically. The electric co-ops became defenders after decades and hundreds of co-ops. Until this sector is large, durability comes from the co-ops' own charters and money, not from votes.
+- **Pressure outside the law.** Other banks refusing to work with co-ops, co-ops shut out of government contracts, targeted inspections. The federation and co-op-friendly lenders like credit unions are the only real answers, and they take time to build.
+- **The courts.** How far *Slaughter* reaches, and whether damages follow when a later law breaks a loan contract, will be settled by judges, not by this design.

JoshHeaps.Net/Content/Socialism/index.md

@@ -16,7 +16,7 @@ This model doesn't buy, seize or convert anyone's company. Instead it builds new
 - **Workers own their company.** Every member gets one vote. A share of the profits grows with tenure until long-time members split them equally. Salaries still exist, and hard jobs still pay more. Part of each year's profit builds up in a personal account that's paid out when you leave, and part goes into a permanent reserve that keeps the business investing. An insurance pool the co-ops pay for protects workers' last paychecks and part of their savings if the co-op fails. [Worker Ownership](worker-ownership.md), [Member Capital Accounts](capital-accounts.md), [Protecting Members' Savings](savings-guarantee.md) and [Investing for the Long Run](the-long-run.md)
 - **A small public bank lends to worker co-ops.** It charges market rates, so it only succeeds if co-ops can really compete. Its whole job is to be willing to lend to a kind of company other banks won't. Spain, Italy and the US have all tried versions of this, and the pilot is built around what went right and wrong. [The Bank](the-bank.md) and [Has This Been Tried?](precedents.md)
 - **Co-ops funded this way stay co-ops forever.** They can't be sold to conventional owners, and members can't vote to cash out what earlier members built. An independent lock-holder can veto any attempt, including selling the business off piece by piece. [The Lock](the-lock.md)
-- **It runs as an honest experiment.** A one-time $350 million pilot aims to fund about 400 new co-ops. The success measures are published before the first loan. If, after twelve years, co-ops stay open about as well as similar conventional firms while paying their members fairly, and the bank earned at least what Treasury bonds would have, Congress votes on growing it. If not, it shuts down automatically. [The Test](the-test.md) and [The Pilot, in Numbers](pilot-spec.md)
+- **It runs as an honest experiment.** A one-time $350 million pilot aims to fund about 400 new co-ops. The success measures are published before the first loan. If, after twelve years, co-ops stay open about as well as similar conventional firms while paying their members fairly, and the bank earned at least what Treasury bonds would have, Congress votes on growing it. If not, it shuts down automatically. It's built so that a hostile government can't quietly freeze it or rig the result, though Congress can always repeal it. [The Test](the-test.md), [The Pilot, in Numbers](pilot-spec.md) and [Making It Last](durability.md)
 - **Co-ops back each other up.** They pool part of their profits into a shared fund. If one fails, its workers are moved into others instead of being left with nothing. [The Federation](federation.md)
 - **Nobody is left behind by low-margin work.** Owning a company doesn't help much when there's barely any profit to own, so a strong floor covers the rest. [Ownership and the Floor](the-floor.md)
 

JoshHeaps.Net/Content/Socialism/open-problems.md

@@ -19,7 +19,7 @@ An honest list of what the model hasn't solved yet, most dangerous first.
 
 5. **Scale.** Even a total success at pilot scale leaves most workers in conventional firms. The labor-market effect needs a sector large enough to move wages, and nobody knows how long growth to that size takes, if it happens at all. That's the price of not forcing it.
 
-6. **Political durability.** See [The Constitution](constitution.md). Gradual construction invites gradual repeal.
+6. **Political durability.** *(Partly answered.)* Gradual construction invites gradual repeal. [Making It Last](durability.md) builds the bank to survive a hostile government: the lending standards and the test are fixed in law, board vacancies can't freeze lending, the verdict says "not tested" rather than "failed" if the bank turns away applicants who meet its own standards, and repeal can't unlock the co-ops. Still open: after the Supreme Court's 2026 ruling any president can replace the bank's board; money not yet lent can be taken back in a budget bill; the lock's bankruptcy protection depends on a federal law that can be repealed; and at pilot scale the sector has no real constituency.
 
 7. **Growth and dilution.** Softened by the tenure ramp, not eliminated. In steady state, an equal split per head still means a marginal hire must generate the average surplus to break even for incumbents. Capital-intensive expansion into lower-margin lines will face internal resistance conventional firms don't have.
 
@@ -29,7 +29,7 @@ An honest list of what the model hasn't solved yet, most dangerous first.
 
 10. **The pilot's own weak points.** [The pilot](pilot-spec.md) puts the burden of proof on the co-ops, which means roughly a 1-in-10 chance of shutting down a pilot that was actually working. It tests individual co-ops, not the [federation](federation.md) support network Mondragon relied on. Its [support lottery](pilot-spec.md#the-support-lottery) tests hands-on help after the loan, but not help *before* a co-op exists, which is where Mondragon started and which might matter most for getting enough good co-ops founded. And unlike Mondragon and Italy's Marcora Law, it doesn't require members to put in money of their own. That's a real trade-off: a stake from members screens out people who only want the loan, but it also shuts out workers with no savings. Its comparison group (small businesses with government-backed loans) is biased in directions that partly cancel out, by amounts nobody knows. And market-rate lending based on collateral may mostly reach founders who already have some wealth. Approval rates by race, gender and wealth are published so that shows up, but publishing a gap doesn't close it.
 
-11. **Federal or state?** A federal bank is the cleanest single experiment. But a few state-chartered lenders running one shared, pre-registered plan would fail smaller, fit the fact that co-op law is state law, and might be harder to repeal all at once. That trade-off hasn't been worked through.
+11. **Federal or state?** *(Mostly answered.)* The test stays federal, because one bank with one plan makes one clean experiment. Any state can copy the bank under the same published rules, reported separately, and a model state law protects the lock ([Making It Last](durability.md#federal-test-state-copies)). Still open: whether a few state lenders sharing one plan would have been the stronger experiment after all, since the most durable public bank in America, North Dakota's, is a state bank.
 
 12. **Voluntary buyouts: in or out?** *(Open question.)* Should the bank also finance existing owners who *choose* to sell to their workers at market price, the way the UK's employee-ownership trusts work? It would grow the sector faster without forcing anyone. But it would mix two different experiments, and conversions carry different risks than startups.
 

JoshHeaps.Net/Content/Socialism/pilot-safeguards.md

@@ -104,4 +104,4 @@ This page lists the ways someone could cheat [the pilot](pilot-spec.md), or sabo
 
 - **Every loan is public:** the borrower, the amount, the rate and the terms.
 - **Every contact from an elected official or their staff about a specific loan is logged and published.**
-- **The board answers to elected officials. Individual loans don't.** Officials can appoint and remove the bank's board. But no official can direct a decision on a particular loan, and loan officers are bankers, not appointees.
+- **The board answers to elected officials. Individual loans don't.** The President can appoint and remove the bank's board at will. But by law no official can direct a decision on a particular loan, loan officers are bankers, not appointees, and a new board can't change the filed lending standards without the results being reported both ways (see [Making It Last](durability.md#what-a-new-board-cant-change)).

JoshHeaps.Net/Content/Socialism/pilot-spec.md

@@ -206,4 +206,4 @@ At year 12, both measures must pass:
 - **Whether the labor market changes.** 400 co-ops won't move anyone's wages. See [The Test](the-test.md).
 - **Whether the best founders come.** The test measures the co-ops that *did* apply. If strong founders stay away ([The Founder Problem](founder-problem.md)), a pass means "the co-ops that exist can compete," not "co-ops would win with everyone's best people."
 - **Whether co-ops do better with a full support network.** The pilot funds individual co-ops. It doesn't build [the federation](federation.md) that Mondragon relied on, so co-ops that join a federation are reported separately. The [support lottery](#the-support-lottery) tests one piece of that network, hands-on help, but not the rest: shared funds, moving workers between co-ops, joint buying and selling.
-- **Whether it survives politics.** Congress can refuse the second capitalization, or repeal the whole thing. See [The Constitution](constitution.md).
+- **Whether it survives politics.** Congress can refuse the second capitalization, or repeal the whole thing. A hostile board could also try to rig the result, which is why the verdict can be "not tested" rather than "failed" if the bank turned away applicants who met its own standards. See [Making It Last](durability.md).

JoshHeaps.Net/Content/Socialism/the-bank.md

@@ -17,7 +17,7 @@ Mondragon's history supports the first half of the premise. For decades, apart f
 
 - **Charter:** lends only to firms that meet the [co-op definition](worker-ownership.md) and accept [the lock](the-lock.md). The bank can't widen its own charter. Mondragon's bank drifted into ordinary lending after a change in the law, and America's co-op bank drifted toward the safest co-ops once nothing held it to its target (see [Has This Been Tried?](precedents.md)). A charter can't stop Congress from changing it, but the fixed measures and deadline in [The Test](the-test.md) mean a mission change can't happen quietly.
 - **Priced at market rates.** This is deliberate. The bank's edge must be *willingness* to underwrite a firm structure other lenders refuse, not *cheap money*. If it lends below market, every result is unfalsifiable: success gets dismissed as "free state money," failure gets dismissed as "hobbled by the lock." At market rates, survival and returns mean something.
-- **Professional, insulated underwriting.** Loan officers are bankers, not appointees. Lending decisions are walled off from legislators the way monetary policy is walled off from Congress. A bank that funds whichever co-op has the best-connected sponsor fails the experiment and deserves to.
+- **Professional, insulated underwriting.** Loan officers are bankers, not appointees. Lending decisions are walled off from legislators the way monetary policy is walled off from Congress. A bank that funds whichever co-op has the best-connected sponsor fails the experiment and deserves to. Since 2026 the Supreme Court has made clear that any president can replace a board like this one at will, so the protection lives in what the board can't change, not in who sits on it (see [Making It Last](durability.md)).
 - **Self-sustaining by design.** One-time capitalization, then it lives on its loan book. Losses are public and published. A permanent appropriation would turn it into a subsidy line, and subsidy lines get captured.
 - **Full transparency.** Portfolio data (default rates, survival, wages, productivity, member retention) published annually, so anyone can check the result, including critics.